Last year, we hired a contractor to help us tackle a big home renovation project. Since I’m self-employed and my husband works from home a few days a week, having a dedicated space for us to work became a necessity. We decided that converting the basement into a home office space was the way to go.
We knew that with big renovations come high costs so we searched hard to find an affordable, but reliable contractor to help us get the job done within our budget. If you have a home renovation you’re planning, here are eight ways you can save big on your next project!
Run the Numbers
Since we’ve never tackled such a big project like this we didn’t know how much it should cost. Before calling around, we used tools like Homewyse to get ballpark figures for our renovation. It made it easier to compare the costs of different contractors at once.
It’s way easier to plan out your renovation once you get a better idea of the total cost. You’ll be able to allocate funds to certain parts of the project and hold yourself accountable if you catch yourself spending more than your budget.
Save Before Starting a Renovation
Another benefit of getting that estimate was it gave us a savings goal. Make sure you’re setting up a few automatic transfers so you’re saving for your renovation project. We knew we wanted to do this renovation debt-free so saving was an absolute must. Even if you decide to go with some financing, having money saved is a wise move.
Get Multiple Estimates
We asked our friends and family for recommendations so we knew that the contractors we called were high quality. We were surprised at how much estimates can vary between contractors. Having different estimates allowed us to dig in and ask them questions on how they planned on approaching the basement.
Sometimes the lowest price isn’t the best one. It may be that they haven’t thought the project through and are not calculating all the expenses. Having multiple estimates can help you make sure you’re receiving the best deal at the best price.
Create a budget
Once you have your estimates, you should then create a budget for your renovation. Keeping your expenses in check is a must. Make sure you’re clear with your contractor about your budget. Even though you’ve got a pretty good idea on how much you need to have to finish the project, it’s always smart to include 15-20% to cover unexpected expenses.
For example, after opening up a wall, your contractor might discover an issue that needs to be fixed. You want it done right, so having that money allocated will allow you to do the repairs or updates and still get the renovation you want.
Work within the Your House’s Footprint
Taking down and adding walls makes for an interesting Fixer Upper episode, but you have to be thoughtful if you don’t want to break your budget. Work with your contractor to find ways to stay as close to the home’s layout as possible when it comes to load-bearing walls. You want to find that balance of looking good, being functional, and keeping costs reasonable.
Break Up a Big Renovation
Unless you’re on a time crunch, you should try to do big renovations in phases instead of all at once. For the basement, we focused on the outer perimeter first so right now it’s one giant, but functional space. Besides keeping our renovation costs low, it also gives us a better opportunity to use the space and decide how we’ll partition down the road.
Reusing home décor is not only beneficial for your wallet, but it can also keep the character of your home. As you’re designing your new space, look for ways you can incorporate what you already have in your home. If you can’t reuse an item, but it’s in good condition, consider selling it for extra cash or donating it to a qualified charity (which could then be a write-off on your taxes).
DIY with Smaller Projects
If you’re breaking a renovation down, you may find that there are some projects within your skill set and level. Our contractor took care of the electrical and other specialized work, but we did the painting. It might seem small, but taking on the little projects can save you some serious bucks over the long run.
The home office renovation was a huge win for my taxes since I am self-employed and expenses related to the renovation of my home office were tax deductible. If you are self-employed, you can use QuickBooks Self-Employed to help you easily track your business income, expenses, mileage, and receipts year round. Your information then easily exports to your TurboTax Self-Employed tax return at tax-time.
If you have questions, you can connect live via one-way video to a TurboTax Live Self-Employed CPA or Enrolled Agent and get your tax questions answered. TurboTax Live Self-Employed CPAs and Enrolled Agents are available in English and Spanish and can also review, sign, and file your tax return.
Your Take on Home Renovations
I’d love to hear from you. What home projects have you tackled so far? What renovations are on your to-do list?